While Disney has seen a hefty increase in revenue from their parks and resorts, partly due to the fact that Shanghai Disney wasn’t open in the same quarter last year, all other segments saw decreases from last year. Media continues to fall as Disney’s struggles with ESPN still prevent the segment from higher revenue and profitability. Consumer products and interactive media is an interesting segment as it saw a decrease in revenue, but an increase in income. Disney points to lower general and administrative costs in their merchandising licensing operation, as well as, lower product development costs as the reason for the increase in profitability.

The interesting segment is studio entertainment, where we see a sharp 16% drop off from 2016. It seems this is a case of Disney setting the bar pretty high last year. A quick comparison of the two years illustrates this theory pretty well:

Movies released in Q3 FY 2017:Guardians of the Galaxy Vol. 2, Pirates of the Caribbean: Dead Men Tell No Tales and Cars 3.

Also worth noting is Disney was actively promoting the home entertainment releases of Zootopia and Star Wars: The Force Awakens during this period last year, while this most recent quarter saw promotion of Rogue One: A Star Wars Story and Beauty and the Beast (and a little Moana still). Clearly, 2016’s success across the board would be tough to replicate; Even for Disney.

Walt Disney Company Reports Q3 FY 2017 Earnings Highlights:

$2.366 billion in quarterly net income which was $2.597 billion the same quarter last year

$14.238 billion in quarterly revenue which was $14.277 billion the same quarter last year

1% decrease in revenue from media networks (cable & broadcast) from the same quarter last year

12% increase in revenue from parks and resorts from the same quarter last year

16% decrease in revenue from studio entertainment from the same quarter last year

5% decrease in revenue from consumer products & interactive media from the same quarter last year

Looking forward, Disney is pointing to significant changes in their digital products and services as potential game-changers across multiple segments. Their plans to spin-off their own content distribution services should improve performance of their studio entertainment segment, as well as ESPN. Disney also plans to increase their ownership stake of BAMTech, their digital partnership with Major League Baseball.